Repair Delays and Rental Car Expenses Set to Escalate
Beyond costs alone, tariffs will disrupt automotive supply chains, lengthening repair times considerably. Delayed repairs mean longer periods during which drivers rely on rental vehicles, increasing the financial burden on both insurers and consumers.
“We saw similar delays during the COVID-19 pandemic when parts were scarce,” said an independent insurance agent from Rochester, New York. “Drivers with rental reimbursement coverage often exceeded their policy limits due to prolonged repair waits, leading to substantial out-of-pocket expenses.”
As rental reimbursement coverage typically caps at around 30 days, policyholders may find themselves paying significantly more if their car remains in the shop beyond this period.
Projected Timeline and Magnitude of Insurance Premium Increases
While the exact impact and timing of rate increases may vary, the APCIA forecasts that consumers will feel significant premium hikes within the next 12 to 18 months.
“Insurance rate adjustments lag behind immediate market changes,” explained an analyst with APCIA. “Insurers need months of data to justify increases, and state regulatory approvals add further delays. Given that auto policies renew every six months, many consumers might not experience premium hikes until well after tariffs have begun affecting costs.”
